Thursday, June 30, 2005

Introducing Orpheus Sports & Entertainment

We wanted to let you know that Joe Rosen (an occasional contributor to this blog) and Chris Brown, Boston attorneys who also are adjunct professors of sports and entertainment law at Boston College Law School, are joining forces as Brown & Rosen LLC and Orpheus Sports & Entertainment. Brown & Rosen LLC is a full service law firm with a specialty in sports and entertainment law. Orpheus Sports & Entertainment is a consulting company through which Joe and Chris provide representation services to athletes and entertainers. Joe and Chris have each been practicing for over six years in the sports and entertainment sectors. Websites will be up soon, and we will provide links when they are. Please feel free to call Joe at 617-877-3837 or e-mail him at if you would like more information.

See 9/17/2005 Update: Profiles in Sports Law: Orpheus Sports and Entertainment Company

Wednesday, June 29, 2005

Court Rules In Favor of Angels

The city of Anaheim has suffered another legal setback in its continuing battle with the (Los Angeles) Angels. A California appellate court affirmed a lower court decision that will allow the team to use the Los Angeles name for the remainder of the season. The team was seeking a temporary injunction against the use of Los Angeles until the matter could go to trial. The court did not issue an opinion, but to issue the injunction it would have had to find that irreparable injury would be done to the city in its absence. The city must now decide whether to continue pursuing the case. (McKibben, "Anaheim loses its battle for now," LA Times, 06/28/05).

For more on Anaheim vs Angels, see these earlier posts (1/3, 1/10, 1/22).

Tuesday, June 28, 2005

The Red Herring of Age in the NBA Draft

The following is my reflection of the recent imposition of an age floor in the NBA Draft, and also my law review article Illegal Defense: The Irrational Economics of Banning High School Players from the NBA Draft.

Later tonight, the NBA will conduct its annual entry draft. Among those players drafted will be those who recently graduated from high school. Numerous basketball analysts and social commentators will express dismay at the prospect of these players skipping college and earning millions of dollars a year. They will then praise the NBA and the National Basketball Players’ Association for agreeing to institute an age floor of 19, effective for next year's draft.

What these analysts and commentators will not mention is that banning high school seniors from the NBA Draft is perhaps the most illogical decision in the history of professional sports. It may also prove illegal. Consider salient facts that belie popular rhetoric: high school seniors in the NBA average more points, grab more rebounds, and dish out more assists than does the average NBA player or the average player of any age group. Banning them is akin to removing the best part of a product from that product.

Common sense might suggest that NBA teams can more deftly measure a player's ability after he has played in college. But remember, age is merely a proxy for maturity and preparedness. For instance, the federal government has determined that 18 is the age when citizens are mature enough to vote. Surely, some citizens younger than 18 possess the requisite maturity to vote, and of equal certainly, some older than 18 do not. And in a perfect world, this is something that we could test. But for a variety of practical and legal reasons, we can't, so we use a proxy.

NBA teams are radically different. They do not need proxies to tell them which players should or should not be drafted, because their scouting departments already provide that information. Pre-draft evaluations entail exhaustive reviews of game tape; private workouts; interviews with prospective draft picks, as well as their coaches, families, and friends; and even cognitive and psychological examinations—all done to specifically measure the ability of that player to succeed in the NBA. In short, the behavior of NBA teams contradicts the very premise of an age proxy.

Moreover, to the extent teams want to avoid mistakes in drafting, perhaps they should hire better scouts. Consider the long list of college seniors who NBA teams wrongly predicted would become stars: Ed O'Bannon, Mateen Cleaves, Trajan Langdon, Troy Bell, Reece Gaines, Rafael Arajuo--this list could go on for pages. An age floor would not have stopped teams from selecting these players. Along those lines, sometimes it isn’t about the player’s age; it’s about others' ability to measure his talent.

And this begs a question: why preclude 18-year old basketball players from earning a paycheck when 18-year olds can earn an income doing just about anything else sports or entertainment related? Players in baseball, hockey, soccer, golf, and tennis, can all earn millions by age 18, and some at earlier ages. Teenagers can even become professional boxers and repeatedly punch and get punched in the head, and yet they do not encounter the same moral outrage experienced by those who seek to take jump shots on NBA courts.

Of course, if we believe the opponents to allowing recent high school graduates in the NBA Draft, we would also believe that high school players tend to be less mature and law-abiding than is the average NBA player. But since when did when did age and college experience prove predictive of NBA player behavior? Latrell Sprewell, a college graduate, choked his coach at age 28. Ruben Patterson, also a college graduate, pled guilty to attempted rape and became a registered sex offender at age 25. And with two years of college credit in tow, a 24-year old Ron Artest attacked a fan in Detroit. In contrast, NBA players without college educations have been, by in large, a model group of citizens. In fact, of the 36 high school players who have been eligible to be picked over the last 10 years, only four have encountered any criminal crimes, and in the case of both DeShawn Stevenson and Kobe Bryant, those charges were subsequently dropped.

Lastly, remember that education is not a “one-shot” deal in life. A number of NBA players have gone back to college later in their careers, after they have made their millions. Sometimes the most intelligent course of action is playing first and studying second. That seems especially true given the real possibility of suffering a career-ending injury at any time on the basketball court: if that injury occurs on an NBA court, the player has a guaranteed contract, likely worth millions of dollars; if it happens on a college court, well, let's hope his grades are good (which is not likely given draconian time constraints on his studies: the average Division I basketball player spends 40-50 hours per week playing games, practicing, attending team meetings, lifting weights, and traveling, at the same time most colleges and universities prohibit all their other students from working in excess of 10-20 hours per week; no wonder why of the 65 teams that participated in the men's 2005 NCAA Tournament, 42 of them failed to graduate even half of their players.).

Despite the irrationality and unfairness of an age floor, the NBA contends that it has a legal right to collectively-bargain one, and it cites the National Football League’s recent judicial victory over an amateur player, Maurice Clarett, who sought to challenge an age floor. But remember: the legal precedent "established" by Clarett v. NFL is only the ruling of one U.S. federal court of appeals; there are 11 other ones that might disagree if presented with the same or similar facts. Moreover, while Clarett had to argue a hypothetical, a banned high school basketball player would possess 10 years of incontrovertible evidence: those who skipped college are the best group of players in the NBA.

The legal argument will also contemplate how the NBA possesses an economic monopoly on pro basketball. While it is technically correct that a banned 18-year old could play in Europe or in the minor leagues, there is an astronomical pay disparity between playing in the NBA and playing in those venues. Put differently, they are not substitute employment opportunities, and there is real economic harm in the disparity. Just consider this: the average first round pick in tonight’s draft will earn $1.6 million next season; if instead he could only play professionally in the CBA or the NBDL, he would make between $20,000 and $35,000. If he went to Europe, he would be lucky to break $75,000 in his first season. And then add to that lost endorsement opportunities, and the economic harm is even greater. Really, this isn't a matter of apples and oranges. It's one of apples and tic-tacs, and that is often a tell-tale sign of a group boycott from an economic monopoly.

Nevertheless, tonight’s NBA draft may prove to be the last one where the optimal draft group--high school seniors--can participate. Maybe high school seniors aren't the ones who need more education.

See Update 7/28/2005: NBA Player Arrest Study and Age/Education

Saturday, June 25, 2005

NBA Draft Age Ban Discussion

See Update 7/28/2005: NBA Player Arrest Study and Age/Education

Some quick hits:

Omar Kelly of the South Florida Sun-Sentinel discusses the issue (Kelly, "Preps Pipeline Closing," 6/25/05). He discusses my view and that of Professor Bob Jarvis:
Michael McCann, an incoming professor at Mississippi College School of Law and a member of Clarett's legal team, believes a similar anti-trust lawsuit against the NBA is imminent, possibly coming as early as next season from a player with the 7-foot Oden's stature. McCann believes that case would have more merit than Clarett's because of the league's history.

"The road for this has been paved by the Clarett decision," said Bob Jarvis, a sports law professor at Nova Southeastern University, who is writing a book, Sports Stories, which takes a look at prominent sports legal cases. "If Clarett had gone the other way, the NBA wouldn't even think of doing this."
Emily Badger of the Orlando Sentinel also discusses the issue (Badger, "Pro Leagues Not Immune to Labor Woes," 6/25/05), and cites remarks from Professor Joe Rosen--Partner of Orpheus Sports and Entertainment Consulting Company in Boston and adjunct sports law professor at Boston College Law School--as well as Professor Paul Haagen, co-director of the Center for Sports Law and Policy at Duke University School of Law:
"When agents and players see the amount of money going into teams with huge TV contracts, huge sponsorship deals, group licensing deals, when they see all the money going to the owners, players think, 'We should be entitled to that. We need to deal with this on the labor front,'" said Joe Rosen, a lawyer and partner in the Orpheus Sports and Entertainment consulting company in Boston.

"Stability in economics leads to stability in labor relations," said Paul Haagen, co-director of the Center for Sports Law and Policy at Duke University's school of law.
Also, Professor Rich Karcher--director of the Center for Law and Sports at Florida Coastal School of Law--responds to Greg's excellent post below and raises several excellent points of his own:
I have to take exception to Greg's opinions on the new NBA age limit. Even though it's only a one year difference, it's so much better for the clubs because they don't have to spend the resources scouting high school games and they get to see the kids in a much more competitive D-1 environment so it eliminates a lot of the risk that's involved in scouting/assessing high school talent. I don't agree with Greg's "one and done" argument that, because players will go pro after one year, colleges will be discouraged from taking the high school superstars. In fact, I think the reverse will happen. Under the 18 year rule (just like in baseball), colleges are hesitant to sign the elite players because they risk losing a scholarship if the player signs a letter of intent and ends up going pro after high school. Under the new rule, there's no risk of losing the scholarship. In addition, there's always the possibility that the college coach will be able to convince the player that it is in his best interest not to go pro after only one year of college.

Wednesday, June 22, 2005

Connecticut Ethics Panel Clarifies Rules for Coaches' Endorsements

A Connecticut ethics panel has ruled that the law preventing state employees from using their public office for private gain applies to all state employees, including UConn basketball coaches Jim Calhoun and Geno Auriemma. While the report specifically exempts current contracts the coaches have, including with Nike, the endorsement deals will face more intense scrutiny upon renewal.

The commission's report clarifies that the so-called "celebrity exception," which had been implied in previous reports, does not exist, and that all state employees must be treated equally. This does not mean that Connecticut public employees cannot attain any private gain, however. For instance, the state's former forensic chief Henry Lee gained fame and consulting fees assisting in several high-profile cases, including the O.J. Simpson murder trial. The key seems to be whether or not the outside contracts would impair the "independent judgment" of the coaches. (Kauffman, "Ethics panel clarifies policy for coaches," Hartford Courant, 06/21/05; "Board rules no ethics exceptions for celebrity state employees," Conn. Times, 06/21/05).

It will be interesting to see how Calhoun's extension is scrutinized when it is renewed in August. If it comes under heavy fire, big-name coaches may be reluctant to come to UConn in the future and potentially jeopardize a large portion of their income. Chances are good, though, that the state will find a way to accept these deals. But as one columnist asks, wouldn't it be better if these endorsements benefited the school and not the individual coach? ("No special terms for stars," 06/22/05).

Tuesday, June 21, 2005

Lawsuits Filed over Formula One Race

Well, you knew this was coming. Three fans who were at the F1 race at the Indianapolis Motor Speedway on Sunday for the debacle that was the US Grand Prix have filed lawsuits claiming that F1, the sport's governing body, Michelin, the teams that withdrew from the race and Indianapolis Motor Speedway (IMS) “responsible for not producing the type of event advertised." Expect some refunds to be issued and for this to all go away. Just like Formula One, which probably won't be back in the US anytime soon (although you never know). (Cavin, "F-1 roar drops a notch, Indy Star, 06/21/05).

Hat Tip: Sports Business Daily (subscription required)

The Legality of the New CBA

Below I discuss the new NBA collective bargaining agreement (6/21), including thoughts that setting the age limit at 19 seems to be a bad idea for both parties.

But regardless of whether the age limit in the CBA is a good idea, I think there is no question that it is legal. The union and the league have freely reached this deal in a bargained-for agreement, which should satisfy the labor exemption to the antitrust laws (if that exemption means anything). Yes, it is arbitrary, but no more so than limiting the teams' rosters to twelve active players.

I am certain that Mike will argue the other side, but it seems that any legal challenge has a tough mountain to climb.

NBA and Players Reach New Agreement

I return from a lengthy absence with news that you have no doubt heard. The NBA and the Players Union have reached an agreement (in principle) for a new collective bargaining agreement. The new agreement, which is outlined on the NBA website, raises the salary cap, increases the percentage of basketball revenue guaranteed to the players and decreases the maximum contract length from seven years to six. It also increases the number of random drug tests, as well as the penalty, and gives teams the right to assign players with less than two years of experience to the NBA Development League. It will be interesting to see how much the teams take advantage of this new power, and more importantly, how the players respond.

One of the biggest items, of course, is that the league has also raised the age limit for draft eligibility from 18 to 19. I have been on record as being in favor of the age limit, while Mike has become famous (HBO anyone?) for extolling its downsides. But, I see this agreement as a potential loss for both sides. Yes, it will be beneficial to have (slightly) more older and (arguably) more mature players in the league, but how much difference will one year really make?

In my mind, the purpose of an age limit is to protect the league's product. The league needs to ensure that its players learn the fundamentals, but more importantly, how to be adults, while in college and before being handed millions of dollars. With this agreement, the NBA has ensured the players will be a little older, but will they be any wiser? Unlike an age limit of 20, or one similar to the NFL where the player must be three years removed from high school, most star basketball players will only have to wait out one year before they can enter the draft. As ESPN points out, players may try and go to Europe or just sit out a year rather than risk injury in college.

College basketball is also harmed by this deal. The number of "one and done" players will only increase, as 18 year-olds enter school only to prove their skills for the next year's draft. While it may be fun to see some of them in school, recruiting will become more difficult as coaches have to choose between a one-year superstar or a four-year solid player. Players certainly will not have the chance to mature, both on the court and off it, through several years in a college setting.

There is no question the NBA is suffering. When the ratings for your championship series are being subsumed by reality television featuring dancing B-level stars, something is amiss. (Forbes, 06/14/05). Robert Horry's (ahem, fundamentals) great 4th quarter may have rescued some audience, but it will be interesting to see if the new CBA can help steer the league back towards mass appeal.

Update: Reader Krikor correctly points out that the agreement not only has a 19 year-old age limit, but also a requirement that US players be one year removed from high school. Thus, players could not merely "repeat" a grade just to graduate at 19, as I had suggested before.

Thursday, June 16, 2005

Proposed New Yankees Stadium: Good for Taxpayers?

The New York Yankees have proposed construction of a new, $800 million ballpark that is privately financed. Although $200 million in city and state funds would be used for infrastructure and parkland, sports economist Andrew Zimbalist of Smith College notes, "any way you look at it, this is a pretty generous deal for the city." Financing for the new Yankees stadium would be certainly different than that for the publicly-financed project recently proposed by the Marlins (and as we recently discussed).

Saturday, June 11, 2005

Assumption College Reinstates Track and Field Team After Allegation of Sex Discrimination

Assumption College of Worcester, Massachusetts has agreed to reinstate both its men’s and women’s indoor and outdoor track and field teams in order to avoid a sex discrimination lawsuit threatened by the Trial Lawyers for Public Justice ("TLPJ"). In a demand letter dated May 10, 2005, the TLPJ charged that the school’s decision to eliminate the women’s teams violated Title IX of the Education Amendments of 1972, the federal law that prohibits sex discrimination by educational institutions receiving federal funds. The school has now confirmed that it will reinstate the teams.

In case you are unfamiliar with the TLPJ, it is a national public interest law firm that has successfully sued several prominent educational institutions--including Brown University, Indiana University, and Temple University--for discriminating against women in athletics. The TLPJ is also engaged in litigation concerning consumer rights, environmental protection, and civil rights, among other areas of the law.

Friday, June 10, 2005

My Interview on HBO

First off, I apologize for the lack of posts. We've been in a busy patch, but we'll now be posting with far greater regularity.

Second, I hope you had or will have a chance to see my interview on Bob Costas' HBO Show "Costas Now." The show first aired last night at 9:00 P.M. EST, and will air again throughout the week (see schedule below). Armen Keteyian interviewed me one-on-one, and the questioning pertained to the NBA's efforts to institute an age floor for entry into the league. Armen separately interviewed high school phenom Greg Oden (a high school junior who is so highly-regarded that if he were eligible for this year's draft, he would be the #1 pick, hands down), his mother, a high school basketball coach, David Stern, and Billy Hunter. It is a great show, as it dismantles many of the popular myths concerning professional basketball players who happen to be teenagers (e.g., "they're immature"; "they tend to struggle" -- the facts, rather than rhetorically-appealing generalities, prove just the opposite). I hope you get a chance to see it (all times Eastern Standard Time):

Fri 6/10 .... 9:00 PM....... HBO
Sat 6/11 ... 1:25 AM........HBO
Sat 6/11 ... 10:00 AM .... HBO
Sat 6/11 .... 7:00 PM.......HBO2
Sun 6/12 ... 11:00 AM.....HBO
Sun 6/12 ... 11:30 PM.....HBO2
Mon 6/13 ... 3:30 PM......HBO
Tue 6/14 .... 12:30 AM....HBO
Wed 6/15 .. 10:45 PM.....HBO2
Thu 6/16 .... 9:30 AM......HBO
Thu 6/16 .... 7:30 PM......HBO

Also, many thanks to Bruce Allen of the fantastic Boston Sports Media Watch for his great post on the interview and Sports Law Blog. If you are a Boston sports fan, or just a fan of seeing someone expose the Sports MSN for its inconsistencies, definitely check out BSMW, which, as we discussed in February, broke the story of how a Patriots' beat writer was badly plagarizing Peter King of Sports Illustrated and HBO.

Wednesday, June 1, 2005

The Relationship Between Age and Performance Among Baseball General Managers

We often discuss age-related issues on Sports Law Blog. Namely, we debate whether age floors are both desirable and legal for the NBA and NFL Drafts. As you probably know, Greg and I disagree on this topic, and if you are interested in my published analysis, please take a look at my law review article "Illegal Defense: The Irrational Economics of Banning High School Players from the NBA Draft, 3 Virginia Sports and Entertainment Law Journal 113 (2004)."

But what about age and performance as a general manager -- does experience and seasoning matter? David Gassko of the Hardball Times just released an interesting study on the performance of general managers in baseball. Using an assortment of criteria, including available resources, difference in record before and after the August 1 trading deadline, and home/away splits (which may reveal how effective the general manager is at assembling players for his team's ballpark), Gassko compiles a ranking.

Who is the best general manger in baseball over the last two years according to Gassko? Why, it's none other than 31-year old Theo Epstein of the Boston Red Sox -- the youngest general manager in baseball. Epstein became the G.M. of the Red Sox at age 29, and since that time, has done something that no other Red Sox G.M. since 1918 could do: win a World Series (with some help from inherited players that were acquired by his predecessor, Dan Duquette).

Obviously, the fact that Epstein is so young does not prove that younger general managers are better. But it does suggest that one need not be old in order to excel as a general manager in professional sports -- and as I contend, the same can be said of players in professional sports, too.